By September 2023, the JPMorgan Equity Premium Income ETF (JEPI) will have made a significant mark on the U.S. actively managed ETF market, with over $29 billion in assets.
Investors are drawn to JEPI due to its impressive performance in 2022 and attractive portfolio features, which include stable dividend-paying blue chip stocks, low volatility, substantial annual returns, and monthly income potential.
The JPMorgan Equity Premium Income ETF (JEPI) presents an attractive option for those seeking income and exposure to the stock market, while minimizing volatility. The fund seeks to generate monthly income through a carefully designed investment approach.
ETF Overview
- Category Derived income
- JPMorgan Fund Family
- Net assets 34.38B
- Total daily return so far: 11.35%
- Yield 7.19%
Sectoral weightings
- technology: 19.65%
- Health care: 15.48%
- Industrial actions: 13.42%
- Financial Services: 11.73%
- Consumer protection: 10.27%
- Cyclic consumption: 10.10%
- Utilities: 5.50%
- Communication services: 4.91%
- Energy: 3.62%
- Real estate: 3.01%
- Basic materials: 2.32%
A dividend ETF with a yield of 11.77%: is it possible?
The JPMorgan Equity Premium Income ETF (JEPI) pays monthly dividends to its shareholders. It has an average annual yield of 11.77%! In other words, over the course of 2022, its performance has significantly outperformed that of US stocks, which have a yield of around 1.70%. It has also outperformed that of REITs and US high-yield bonds, which offer a yield of around 9%.
With €51,000 invested, you could pay yourself an additional €500 per month thanks to this dividend ETF and its 11.77% yield. You would even have achieved a slightly better return than the market since its inception in mid-2020, with 12.03% annualized dividends reinvested versus 12.01% for the S&P 500. Similarly, with lower volatility and maximum drawdown than the market (-13% versus -24% for the S&P 500), you would have achieved better results.
JEPI Stock Chart
DAR Portfolio
He GIVE portfolio It employs a cautious stock-picking strategy, using a detailed bottom-up research methodology to identify stocks based on unique risk-adjusted rankings. In addition, the fund utilizes a systematic options overlay that involves writing out-of-the-money call options on the S&P 500 index, generating monthly income while preserving equity exposure.
JEPI has delivered an attractive trailing 12-month dividend yield of 7.55% and a 30-day SEC yield of 6.88%. These yields are in the top half of the income-derived category, highlighting JEPI’s ability to deliver consistent income. The fund has a low expense ratio of 0.35%, making it a cost-effective option compared to similar options.
JEPI share price today: trading data
JEPI trading data shows that the fund opened at $58.68, with a daily low of $58.85 and a daily high of $58.85. The fund's 52-week low is $48.32 and its 52-week high is $58.66. This shows a stable performance over the past year. In addition, JEPI's assets under management (AUM) total $34.85 billion, with 597.6 million shares outstanding. The fund's average monthly trading volume is 3.27 million, reflecting the active interest of investors.
JEPI has $34.38 billion in net assets and an annual return of 11.35%. It offers a yield of 7.19% and its main investments are in various sectors, such as technology and healthcare, which helps manage risk for income-focused investors.
The average target price for JEPI stock is $63.42, with a forecast high of $71.52 and a forecast low of $52.00. The average target price represents a change of 8.32% from the last price of $58.53.
Alternatives to JEPI shares
Compared to alternative ETFs in the FactSet Equity: US – Large Cap segment, JEPI holds its own. While cheaper ETFs like BKLC offer an expense ratio of 0.00%, JEPI’s expense ratio of 0.35% remains competitive. SPY, the largest ETF by assets under management, has an expense ratio of 0.09% and a cumulative return of 18.22%, but JEPI’s focus on income generation makes it stand out.
The strategy behind the monthly dividend ETF
The JEPI equity ETF is made up of 80% to 85% large US companies with a yield of around 2%. The remaining 15% to 20% of the portfolio is used for an options strategy. More specifically, these are ELNS, Equity-Linked Notes and a more advanced version of covered call options.
In reality, if 80% of the portfolio only offers a 2% return, to get the total 12%, the remaining 20% must offer a 52% return. This high return comes at a price: the ELN risk.
JEPI shares: buy or sell
JEPI offers an attractive option for investors seeking a balance of income and market exposure with reduced volatility. Its strong performance, diversified portfolio, and focus on monthly dividends make it an attractive option for income-focused investors seeking consistent returns.
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